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Category: Deductions


IRS Tax Form Instructions

IRS Tax Form Instructions Form 1040 Basics Helpful IRS Tax Form Instruction Information Taxes! It’s a word no-one likes to hear—but something we all have to pay. IRS tax form instructions are available online and will help make the process as painless as possible when it’s that time of the year.  There is some basic knowledge to keep in mind that will help you when looking for IRS tax form instructions. IRS tax forms are used by tax-exempt organizations and taxpayers to report financial information to the IRS. They are used to report income and calculate the taxes that need to be paid to the United States.   Form 1040 Basics   The most well-known and widely filed form is the Form 1040. This form is used for individual income taxes. It is used for personal income tax returns filed with the IRS. The first form was published for use in 1913. Any full-time United States resident can use the Form 1040 (also referred to as the “long form”). People with no ...

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Charitable Donation Form - What To Look For

Charitable Donation Form - What To Look For   Sections Tax Exempt or Tax Deductible Charitable donation Letter of Determination Deducting Charitable Contribution Form Tips Tax Exemption Categories One benefit for businesses supporting worthwhile causes is the ability to sometimes be able to take a federal income tax deduction. There are many things you should know when considering charitable donations and reviewing charitable donation forms. When you have the chartitable donation from in your hands, keep in mind the Council of Better Business Bureaus offers some helpful tips to help you decide which charitable organizations to support:   Tax Exempt or Tax Deductible Charitable Donation   ·         “Tax exempt” does not always mean “tax deductible.” Tax exempt organizations do not have to pay income taxes. Contributions to some tax exempt organizations may be deductible. You can determine tax ...

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Figure payroll withholding taxes

  Figure payroll withholding taxes To figure payroll withholding taxes, just follow this guide of steps to take and links to resources. Employees’s Gross Pay Minus Required Payroll Tax deductions (including any voluntary deductions) What’s left is the net pay.     Required Payroll Tax Deductions   Since the payroll taxes have to be withheld from your employees’ paychecks, it’s important to understand the different kinds of mandatory withholdings: Federal Income Tax (based on the withholding tables based on the Fed’s Publication 15) Social Security tax withholding (6.2%, up to the annual maximum for that employee) Medicare Tax (1.45%) Any applicable state income tax Any applicable local tax withholdings (like state unemployment insurance, city, county, state disability)   Voluntary Payroll Deductions Voluntary payroll deductions are ones where the employee has previously agreed to the deductio ...

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Employer’s portion for payroll taxes

  Employer’s portion for payroll taxes     After paychecks are sent to employees, your work is only half done. Here’s and explanation of, and how to calculate, the employer’s portion for payroll taxes. These employer taxes are above and beyond your employees’ gross pay.   The employer’s portion for payroll taxes includes these elements: Social Security (6.2% up to the annual maximum per employee) Medicare Taxes (1.45% of wages) Federal unemployment taxes (FUTA) State unemployment taxes (SUTA)   Note: Social Security and Medicare Taxes are commonly referred to as FICA taxes (Federal Insurance Contributions Act). These are paid for by both the employers and the employees in identical contribution amounts.   In addition to covering the employer’s portion for payroll taxes, read our other article to figure payroll withholding taxes.    Modern Business Associates is an HR company that focuses on payroll and HR outsourcing.  As a Profe ...

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Introduction to pay deductions covered by the Fair Labor Standards Act (FLSA)

Introduction to pay deductions covered by the Fair Labor Standards Act (FLSA) The Fair Labor Standards Act (FLSA) establishes, among other things, federal standards for minimum wages and overtime pay that employers are required to follow. Unless a specific minimum wage and overtime exemption applies, employees must be paid at least the applicable minimum wage for each hour worked and overtime for any hours in excess of 40 hours worked in the workweek. Employees who do not qualify for an exemption are commonly referred to as "nonexempt employees" and those employees who do qualify are referred to as "exempt employees." Risks The issue of improper deductions applies to all employees, both nonexempt and exempt. An improper deduction from either is a violation of the FLSA law and such violations can result in investigations by the United States Department of Labor (DOL) and/or expensive and time-consuming litigation. As an employer considering taking deductions from any employee's wages ...

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